tv First Business KICU September 27, 2013 4:00am-4:31am PDT
the aisle is deeply divided in washington. can lawmakers pull together a budget deal before their time is up ? in today's cover story....will a funding boost make way for a flood of new women owned start ups? face-ing regret. facebook hits a milestone. hear what sellers have to say. and.... what fiscal crisis? traders turn over evidence that the budget showdown does not have the market worried. first business starts now! you're watching first business: financial news, analysis, and today's investment ideas good morning! it's friday september 27th. i'm angela miles. in today's first look: a stock bounce back. mixed news on the economy and buying by portfolio managers
lifted the dow up up 55, nasdaq 26 and s&p 5 points. gold sold off 12 dollars and oil ended up small change. investors jump on nike. the stock made a 6% leap after hours in heavy trading volume. nike easily beat earnings forecasts. blackberry cancelled its earnings conference call for today. because of the sale of the company to fairfax financial holdings. the company issued an early peak last week that shows its losing money due to underwhelming sales of the blackberry z10. and google turns 15 today. chris gersch of altimus capital joins us on this friday morning for a look at the trading day. good morning chris. the rally yesterday felt an awful lot like window dressing to me. what do you think? > >good morning angie i think you're right. it is window dressing. i think those shorts were just taking some profits. it looked like it was gonna be a little bit more with it rallying really strongly at the
beginning of the day but a series of lower highs and lower lows---just of a bit of a rally on the end. i think that today, this morning traders are well positioned for another selloff. > >what do you think about facebook? this is a stock that portfolio managers seem to have to own and it traded above $50 yesterday. > >as far as facebook is concerned right now, it's about double from where i sold it. it's a painful recognition as far as having to bail out. only about a $3 loss, but that's a stock i wish i still had in my portfolio. > >what about gold? how are gold traders holding up? > >gold traders right now--- especially at our desk--- because of the volatility of the last month---you go back to august 28th, 1433 on the contract. down to september 18th, 1292. and then that was the day the fed announcement and it rallied to 1375. huge ranges and right now traders are tired. we do believe it's going to break above the 100 day moving average at 1358. i'll look for gold to go higher in the fourth quarter. > >hang in there chris, and
thank you. signs of progress on a budget deal in washington are slowing. today the senate will debate on a budget passed by the house, which includes a measure to de fund obamacare. senate majority leader harry reid has offered an amendment to that measure and the senate is planning for a vote over the weekend -- giving the house just one day to pass a budget before the government hits its october 1st deadline. senate democrats are pushing for a continuing resolution. house republicans have already said they will reject such legislation. meanwhile, house speaker john boehner laid out a list of republican conditions in return for raising the government's borrowing limit. it includes a one year delay of health care reform, overhauls to the tax code, and an array of enviornmental changes including a green light for the construction of the keystone xl pipeline. the president has said he will not negotiate. "some have threatened a government shutdown if they can't shut down this law. others have actually threatened an economic shutdown for
refusing to pay america's bills if they cant delay the law. that's not going to happen as long as i'm president." " on the debt limit, we're going to introduce a plan that ties important spending cuts and a pro growth reform to a debt elimination. now the president says i'm not going to negotiate. well, i'm sorry but it just doesn't work that way." president obama wants to approve a debt limit increase with no conditions attached. he has vowed not to raise the limit without congressional approval. president obama is making his big pitch for americans to get ready to "shop" around for affordable health care insurance. marketplaces that will sell health insurance online-- open for business tuesday. the president insists prices-- will be less than the average cell phone bill. in his speech yesterday... he took a shot at political spin on obamacare coming from the republican party . and the fact is, the republicans' biggest fear at this point is not that affordable care act will fail. what they're worried about is it's
going to succeed. (applause) but the process of starting up the "epic" change to american health care coverage has had bumps along the way. just yesterday the obama administration was forced to delay online enrollment for small businesses until november 1. however, marketplaces are expected to be ready october 1 for an estimated 48 million americans who don't currently have health insurance. they- will be able to enroll at healthcare.gov. consumer reports is putting up its own site at health law helper.org with tips on what to expect when signing up for coverage. "you'll be told, for example, if you're going to qualify for medicaid. you'll be told if you qualify for specialized insurance plans that may have lower than usual deductibles and co-pays. if you are on medicare, you'll be told that you don't have to do anything because you're already insured." according to white house officials starting tuesday-- call centers will be open 24
hours to answer questions about the online process. we connect international which promotes women-owned businesses across the globe says a half- dozen corporations including wal-mart and coca-cola plan to commit one and a half billion dollars in contracts with women-owned businesses within five years, our cover story looks at other advances being made by more than eight million women entrepreneurs, in america---post-recession. sure it's child's play. but it's also a measure of how fast zarahi menendez's early childhood education center is growing. "(short, sharp sound of kids playing)" after only a year and a half, this chicago business run by menendez and her husband raised more than 335-thousand dollars to turn a vacant lot next door into an playground emphasizing concepts of nature as well nurture. "it is good for the kids and has added to our community." the money-managing skills to get an s-b-a loan and expand her business began with a boost from chicago's women's business development center, whose annual conference, this week is
helping more women get started as entrepreneurs. "the traditional sources of capital won't be there for five years, so turn to the wbdc and others for money to small businesses." carolyn gable's 25-million dollar a year trucking business earned her woman of the year by the group. her secret---adapt quickly to change. "a lot of vendors are saying we'll warehouse it for you until you're ready to go so you don't have to buy it all at once." and some of the gains by women entrepreneurs are not measured in profits but safer environments and products. "over the years we've replaced everything toxic and now i don't think we have anything toxic in the shop." during a conference call on
leadership diversity, the head of general motors, dan akerson said it's "inevitable" that a woman would eventually lead one of america's big-three automakers. analysts suggest g- m's mary barra, sr, v-p for global product development may become akerson's successor. jp morgan could be closer to a making a deal with the government. according to reports jpmorgan chase ceo jamie dimon met with u.s attorney general eric holder yesterday. dimon along wtih federal and state authorities are attempting to come to a resolution over shakey mortgage securities the bank sold prior to the finanical crisis of '08. reports estimate to settle the ordeal-- jpmorgan could pay up to $7 billion in cash to the government and $4 billion in consumer relief. the bank turned a profit of $21 billion dollars last year. the bank's stock rose to $51.89 cents yesterday. jcpenney executives have no worries about the company's turnaround. ceo mike ullman says there's no need to raise cash to boost the bottom line. he says online sales are in
double digits compared to a year ago. on wednesday, a reuters report said the company was looking to raise over a billion dollars to help overcome its financial struggle. it sent the stock down 15 percent. shares climbed nearly 3 percent after thursday's announcement. after the close last night the company said it's selling 84 million shares of stock for "corporate purposes". business is brisk at bed bath and beyond. shares raced to a record high thurday after the retailer reported a strong profit. the forecast for the year was within range of expectations. hertz on the other hand is hurting. that stock plunged $4 dollars. as the company cut its full year prediction on weaker than expected business at u.s. airports. bernie madoff's former accountant is under fire from the fbi. paul konigsberg has been charged for his involvement with madoff's $65 billion dollar ponzi scheme. konigsberg, a business acquaintance and close friend of the madoffs for more than 25 years, prepared tax returns for two family foundations and investors in the firm. konigsberg's attorneys claim he's an "innocent victim."
in another scandal, former head of the imf, dominic strauss kahn, is embarking on a new career path as an investment banker at a firm in luxembourg. strauss kahn resigned as head of the international monetary fund in 20-11, after he was accused of sexual assault. those charges were later dropped, though he faces separate charges related to his alleged involvement in a prostitution ring. lawyers deny any wrongdoing. also from the eurozone, the high court has ruled that train operators must pay for delays. passengers will be reimbursed a quarter of the ticket price for delays up to 2 hours, and half the price for longer waits. the case came up after an austrian railway operator refused to compensate riders for delays caused by bad weather or striking workers. back in the u.s.-- the commissioner of the major league baseball is set to retire. bud selig will step down following the 2014 season according to cbs sports.com the m-l-b made financial strides under selig-- who implemented the wild card system, revenue sharing and interleague play. on the
downside he was also in charge during the so-called steroid era. twitter is reportedly staffing up with bankers for its upcoming ipo. the wall street journal is reporting the social media company will add jpmorgan and morgan stanley to underwrite its ipo. already goldman sachs has been said to be working on the filing. the much rumored public debut has been dismissed by the company, but has already received a lot of buzz in the media. reports say twitter aims to go public at the end of november. still to come: the grandma who is taking on proctor and gamble and why.. plus.....another day, another fiscal crisis. why one trader says don't sweat it. and.... bill moller talks to the man who has wielded power over the consumer market for years. it's all coming up...
you've heard the advertisement - "a jd power award winner." it's applied to hundreds of products & brands in travel, electronics and certainly automotive. this highly regarded and influential global marketing information service company began with a conversation over a kitchen table in the home of james david power. j.d. has written his story & that of his company, "how jd power iii became the auto industry's adviser, confessor, and eyewitness to history. welcome mr. power. does the company today in any way
resemble what you and your wife imagined at that kitchen table in calabasas, california in 1968? > >absolutely not. we started off with the children helping out and it grew and grew. and we're very happy for that. > >what accounts for the growth and success? is it luck? is it genius? or hard work? > >i think the most important thing was we ran market research for an industry that was doing its own research in- house. and we did independent studies where we owned the data and we did it across all brands. we were able to give them a rating based on their respective customers and this was innovational so to speak as i look back on it. > >having a third party entity
award these certifications, it really has made a big difference in the industry. did you come up with a methodology in how to measure things like quality? > >yes we did. and we had more detailed questionnaires that were sent out to the public by the brand of vehicle that they had purchased. we were able to get them to give us an honest and frank opinion of what they needed---what the manufacturers needed to do to prove their quality. > >it's an amazing story. a great read. thank you j.d if i might call you that. and great success continued to your company. > >thank you. bill-- this next report is about the power of the people. a chicago grandmother is taking on tide. 27 thousand people have signed onto her petition at change dot org. it urge
procter and gamble to add a proctective wrapper to its tide pod products. erica johnson launched the petition after her grandchild was poisoned. she said he confused the detergent, for candy. 57 hundred children have been poisoned by the product in 2013. p&g did not return our request for comment. but reports say the company changed the packaging to look less like candy in july. and the proctor gamble website warns to keep the product away from children. coming up in traders unplugged...in the stock market they trust. why market action has our traders brushing off the d.c. drama. and in chart talk...why one of our more bearish traders on the show-- is shifting into bullish mode. we'll be right back.
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talk from the trading floor. alan knuckman and james ramelli are here for traders unpluged. good morning. > >good morning. angie: here's your topic number one---crisis de jour. we're hearing a lot about this debt threat, so how do investors make sense of this? alan: it's always something it seems. we're in a new media age so i think people are overly sensitive to all the news but it's gotten to a point where it's crazy. we're 2% off the all-time forever highs in the s &p and people are losing their minds like there's gonna be a market crash. james: right. this little pullback we've had, that had to happen. we do have this little bit of uncertainty about the shutdown but if we're really afraid that this market is going to roll over and that the government is going to shut down, why aren't we seeing bids in the vix? why aren't we seeing gold move? we're not seeing that. i think this is blown way out of proportion. we did this once already this year. alan: trust the market action. opinions aren't anything at all
and you've gotta trust what you see on the screen not what you think is gonna happen. you get paid by predicting the markets not the events. angie: topic number two---oil's well. crude oil is trading at a one month low. is there a safe play in oil? james: i actually think oil has some more downside here. we're seeing all the fear premium getting pulled out of oil. all of the weak longs getting shaken out. i think there's still some more downside. i think the one thing that also could add to that is the taper. alan: there's always the upside shock price risk when you're looking at the oil market. anything can happen in the world. looking at it from a technical standpoint, we're back to the base where we were before the serious stuff happened. we've been above $100 a barrel since july. it's been a long time. it's the new normal. from a risk reward level, lean on the 102. we actually got down and made some new lows over the last couple of days but the volatility didn't make new highs. so that may be a sign that things are turning. angie: topic number three--- google globetrotting. we recently learned that google jets are fueled with a price rate break because of a government subsidy. so what do you think about these stocks? do you think google will soar?
maybe some other internet stocks? alan: if you didn't know that these guys are smart already, they also did this. so they've got it all figured out. looking at google technically, it looks like it's ready to go to a thousand. we could see an $80 move if it breaks above 920. the real only way to play google are with these mini options that were invented this year. i think it's a good value because they're 1/10th the size and that allows the average person to participate. james: i agree with alan about the price target for google. it's just off it's 52 week highs. trading in relatively neutral territory right now. it's been pretty choppy but it does look poised to move higher. however, i disagree about the mini options. they charge you the same amount of commissions to control less stock. alan: who can buy a conventional option? it's gonna be so expensive. you can buy an in the money call here for a couple hundred dollars. it costs you $900 to buy an 800 strike call and it's $800 in the money. so that's the way from a financial standpoint that most people can participate in the google. angie: and your bonus round question---it's fall, so which of these tickers are actual tickers? alan: not this again. i'm 3 for 3. angie: here's the tickers--- leaf, fall, or autumn. which one of those is a true ticker? james: leaf.
dan deming of stutland equities is with us now for chart talk. hi dan. what do you see in the charts for the market? are we headed higher or lower? > >angie, it looks like right now, the market has temporarily bottomed after this selloff that we had. we saw a nice bounce yesterday and it looks like going into the weekend we could see further upside. i have to say, we never really tested that 50 day moving average at 1680 but nonetheless we're still seeing it push and hold around the 1700 level. only about one and a half percent below the s &p high of 1725. so right now on the floor it feels like the momentum has shifted back possibly toward the bullish side. > >what do you see in the volatility index? are people taking out insurance? > >right now it has kinda found a bottom. it's trading right around that 14 level. so even though yesterday we saw the market up a little bit, the vix was basically flat to up a little bit. but i can tell you the futures were coming in yesterday so even though we saw
the cash of the vix up, the futures on the vix were coming in a little bit. so that tells me what you're seeing is a little bit of selling here as the market's been able to hold these levels. > >still the market feels skittish to you it sounds like? > >not necessarily skittish. it feels like it's kind of in a general malaise right now, waiting to see what happens out of washington. we got some reports this morning. we got personal income and spending. we also have...consumer sentiment so those could be important things. also, nike's earnings were pretty positive coming into this morning. right now it just feels like a general malaise. we're looking for what's going to be the next catalys. but by and large you have to say this market's held in there pretty well. > >amazing for you to say that. thank you dan. coming up next week...investor reaction as we inch closer to a possible government shutdown. plus, more on what you need to know about health care reform as the monumental change to insurance coverage happens in america tuesday. that's it for now-- from all of us at first business have some fun, get some rest this weekend.next week could be a doozy.
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